SVB Financial accuses FDIC of improperly freezing $2B in funds trends now
The bankrupt parent company of failed Silicon Valley Bank is seeking access to frozen funds from regulators who seized the bank unit and removed $2 billion of its cash.
SVB Financial Group, which filed for bankruptcy on Friday, in court filings accused the FDIC of 'improper actions' to cut off access to cash deposited at its former banking unit, which was seized by regulators to stem a national bank run.
Though the FDIC guaranteed the uninsured deposits at Silicon Valley Bank, including the cash deposits of the parent firm, regulators said they had frozen SVB Financial's accounts as part of an ongoing investigation into potential claims against the parent company.
Meanwhile, Wall Street CEOs and US officials are discussing the possibility of government backing to encourage potential buyers for battered First Republic Bank, according to Bloomberg News.
The government could play a role in taking on First Republic's most troubled assets, as well as offering liability protection or easing limits on ownership stakes for a potential buyer, the report said, citing people with knowledge of the situation.
SVB Financial, which filed for bankruptcy on Friday, in court filings accused the FDIC of 'improper actions' to cut off access to its cash deposited at its former banking unit
Wall Street extended its rally on Tuesday as fears of a wider banking crisis eased. The Dow Jones Industrial Average rose 316 points, or 1 percent, at the closing bell
Shares of First Republic Bank sank as much as 18 percent in extended trading, after surging 29 percent at the closing bell and leading regional bank stocks higher.
In Tuesday's session, Wall Street extended its rally on Tuesday as fears of a wider banking crisis eased and investors turned their attention to the Federal Reserve's next move.
The Dow Jones Industrial Average rose 316 points, or 1 percent, at the closing bell, after Treasury Secretary Janet Yellen said the government could offer the banking industry more assistance if needed.
Markets around the world have pinballed this month on worries the banking system may be cracking under the pressure of the fastest set of hikes to interest rates in decades.
Global markets now turn their attention to Federal Reserve policymakers, who will announce on Wednesday whether they plan to continue raising interest rates to fight inflation, or pause rate hikes to calm chaos in the banking sector.
On Tuesday evening, financial markets were pricing in a nearly 90 percent probability that the Fed will forge ahead with a 25-basis-point rate increase.
The banking crisis started with the collapse this month of two US lenders, Silicon Valley Bank and Signature Bank, which sank under the weight of bond-related losses due to a surge in interest rates last year.
The turmoil culminated in the $3.2 billion Swiss government-engineered takeover of Credit Suisse by rival UBS over the weekend, heading off fears that
